European Solidarity - "Everybody Knows The Spanish Are Lying About The Figures”

Tyler Durden's picture




 

Back in October, when Greece was rewarded with further bond haircuts for progressively missing its economic targets, even after having gotten caught on at least one occasion making its economy appear worse than it was, we said that it is only a matter of time before "Portugal, Ireland, Spain and Italy will promptly commence sabotaging their economies (just like Greece) simply to get the same debt Blue Light special as Greece." In the aftermath of this statement, we got the Irish and the Portuguese proceeding to slowly but surely do just that. Today, it was Spain's turn to make it 3 out of 4 after as Reuters noted so appropriately, "Spain defies Brussels on deficit target" clarifying that "Spain set itself a softer budget target for 2012 on Friday than originally agreed under the euro zone's austerity drive, putting a question mark over the credibility of the European Union's new fiscal pact. Prime Minister Mariano Rajoy insisted he was acting within EU guidelines because the plan was still to hit the European Union public deficit goal of 3 percent of gross domestic product (GDP) in 2013." That Italy is sure to follow is absolutely guaranteed, however just because the ECB is now indirectly monetizing BTPs the true impact will be delayed far more, and instead of taking prompt steps to remedy the situation, the European complacency will be accentuated by the fact that bond yields are very low, and supposedly indicates the true state of the economy. No. All it indicates is the conversion of future inflation (courtesy of €1 trillion in new money in the past 3 months) for a very temporary respite before all hell ultimately breaks loose as countries pretend everything is ok as bond yields are pushed artificially low. And in doing nothing, the fundamentals in the economy only get worse and worse. Germany knows this very well, and the Economist explains the reaction to Spain's surprising statement today perfectly...

A novice in European summits, Mr Rajoy has been playing a strange game. He was careful not to discuss specific figures with fellow leaders. But as soon as he emerged from the summit he declared that Spain’s deficit this year would be 5.8%, rather than the agreed target ratio of 4.4%. He insisted, though, that Spain would still fall below the 3% deficit limit in 2013, as planned.

 

Germany, moreover, seems to be in an intolerant mood. There is irritation that the Spanish government is delaying its budget pending regional elections in Andalusia that Mr Rajoy's party hopes to win, and suspicion that it is inflating last year's deficit figures to blame its Socialist predecessor. The commission says it wants to double-check the numbers. But a senior source in Berlin puts it more bluntly: “Everybody knows the Spanish are lying about the figures.”

Funny. And yet the people are supposed to believe in the mumbo jumbo that is Europe's fiscal pact, or frankly anything else? Perhaps the senior source in Berlin should have just stepped up and told the outright truth: "Everybody knows that everyone in Europe is lying about everything."

And therein lies the rub. Because with nobody having any real clue what state the real global economy is in, and everyone knows it is far worse than represented yet central banks throwing gobs of liquidity in an attempt to mask a problem that stems precisely by the kind of inaction that this kind of intervention perpetuates, we can guarantee that the next time around we have adverse statements about the various European economies, it will not be a lie, but an understatement.

And just then, when the reality catches up with myth once again and sovereign risks explode one more time, we get all central banks activate the same rinse-repeat spin cycle of excess liquidity that does nothing to fix the underlying insovlency problems, whose short-term liquidity fixes are getting progressively shorter and shorter. Alas this cycle of self-delusion and reality will continue, with ever wider swings in amplitude until the N+1 injection is so big that the floodgates finally open and wheelbarrows are the most desired object on earth.

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Fri, 03/02/2012 - 17:15 | 2218160 Tsar Pointless
Tsar Pointless's picture

"It's lies. it's all lies." Mother Bates, Psycho

Fri, 03/02/2012 - 17:40 | 2218246 Zero Govt
Zero Govt's picture

at least Mother Bates got to the point

these cretins will windbag and re-arrange the deckchairs until the end of time if allowed.. anything but face the cull

Fri, 03/02/2012 - 18:06 | 2218312 Ahmeexnal
Ahmeexnal's picture

Meanwhile, GM announces production of Volt will be suspended.
Apparently, the introduction of the iCar (alongside the new iPad eXtreme) next week has already taken its first casualty.

Fri, 03/02/2012 - 18:13 | 2218332 knukles
knukles's picture

The Poelsi Mobile Obamanation by Government Motors

Hey, they was gunna sell sum furty thosund of them suckers, weren't they?  If they don't keep a makin' 'em till I's back on mys feets, I'll never gets a chance ta buy one.  'Less they take my SNAP thingies.

Fri, 03/02/2012 - 21:06 | 2218743 Bunga Bunga
Bunga Bunga's picture

Gas way too cheap. Federal reserve will take the appropriate measures.

Sat, 03/03/2012 - 00:42 | 2219134 DoChenRollingBearing
DoChenRollingBearing's picture

Speaking of bunga, we have a friend in Italy who says things are BAD over there.  Lot sof fear.  Lots of lies.

Sat, 03/03/2012 - 05:22 | 2219292 The Big Ching-aso
The Big Ching-aso's picture

 

 

"Que Sera, Sera,

Whatever will be, will be,

The future's not ours, to see

It's Goldman's pendejos,

Que Sera, Sera....."

Repeat with Chorus..........

Sat, 03/03/2012 - 11:03 | 2219549 withnmeans
withnmeans's picture

Look at what will soon be here, true as it maybe there are a lot of tax evaders all over the world. When countries get pushed to the limits, look out. I believe in paying my "fair share", if not, then we would be a 3rd world country. Lets make it "fair", I would like the option of a flat tax rate, and not have to go through this "Bullshit" every year to do my tax return. I want to pay it and be done, then I know I'm done, and our Government knows how much they have to "spend". Hell they could almost do away with 3/4 of the IRS.

Anyway, here is a short read on Spanish tax evaders. It will be coming this way next.

http://www.typicallyspanish.com/news/publish/article_33913.shtml

Sat, 03/03/2012 - 06:34 | 2219389 Ghordius
Ghordius's picture

ok, ok, so in Europe a lot of Europeans are waking up to the fact that the other one is lying... hmmm... sorry, the funny thing is that we know since long that they were lying.

what made a kink and a stink is that nobody knew how much more Greece was lying, and for that they needed expert help from the Squid. And I remember how then there was this question if the Squid cooked the books of other Southerners in this extreme way, too.

I think this point has really not sunk in - they lied big, professionally and well and it flew under the radar.

but lying - in moderation - is normal for all human organizations, hell, it's even normal - again, in moderation - for a couple (the smallest organization)

look up for example since how long we were employing satellites to count on olive tree and other statistics that were in danger to be fudged too much.

Thankfully both the USA and China are not organized in Solidarity Clubs of democratic Sovereigns each suspicious of the complete honesty of the others and each with the own intelligence assets to check on the others. So I can safely assume that both are lying in even stricter moderation than the Europeans, probably only by the fifth figure after the comma.

Fri, 03/02/2012 - 17:51 | 2218275 Osmium
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You're sure you won't have a sandwich?  http://www.youtube.com/watch?v=iS6chrslAfo

Fri, 03/02/2012 - 17:17 | 2218170 battle axe
battle axe's picture

Why wouldn't they given how Greece got slammed in the ass...

Fri, 03/02/2012 - 18:22 | 2218351 knukles
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Juncker:  You Spaniards lie like Greeks.
Zapetero:  Whatcha whatch chew mean to be sayingk, becausea we not bees a like a de Greeeks.  Wel tella da truth.
Papademos:  Who da fucka you callin a lyin Grek, eh?  I puncha you ina a da mouth you fucking Kraut.
Juncker:  I'm not a Kraut, I am a proud Luxembourgese, you man of small penis parts and...
Barossofats (his nickmane):  Gentlemen, gentlemen, let us calm down and reconsider our focus, after all Portugal, who is not represented here at this moment, has over 385 tonnes of gold.  Why do we bother with other such sundries?
A rousing cheer by all:  Portugal it Is!!!!!

Curtain
FIN

(Ode to Joy in background)

Who the fuck do these people think is gonna be the last man standing?
Idiocy on the High Seas!

Fri, 03/02/2012 - 17:18 | 2218173 Christoph830
Christoph830's picture

Beautifully put, Tyler.

Fri, 03/02/2012 - 17:19 | 2218174 KingPin 999
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Wait, so this is bullish for Apple, right?

Fri, 03/02/2012 - 18:03 | 2218251 Zero Govt
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more relevant plays, this is bearish banking, PIIGS and lipstick

Fri, 03/02/2012 - 18:10 | 2218321 Goldilocks
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Lipps Inc - Funky Town (1980)
http://www.youtube.com/watch?v=5CImrIKNmBo (3:47)

Fri, 03/02/2012 - 18:02 | 2218303 SPAREPARTS
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Trouble in river city, Brother

Fri, 03/02/2012 - 18:04 | 2218309 Zero Govt
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Dublin or Paris?

Sat, 03/03/2012 - 01:24 | 2219221 Milestones
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They don't have marching bands who play trombones in Dublin or Paris.                   Milestones

Fri, 03/02/2012 - 17:19 | 2218179 LawsofPhysics
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An organized group of liars is way more effective at getting what they want then a much larger group of diverse, self-centered bunch of even the most intelligent people.  

If people don't like "the game" or "the system" they need to simply stop playing and let spain feed nd fend for itself.

 

Same as it ever was.

Fri, 03/02/2012 - 17:21 | 2218185 The Reich
The Reich's picture

You mean the Spaniards are the new Greeks?

Fri, 03/02/2012 - 18:12 | 2218331 sessinpo
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During the tech boom, it was all the rage to be the geeks. Now it is greeks. We are all greeks now

Fri, 03/02/2012 - 18:24 | 2218355 knukles
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Beware Greeks bearing amyl nitrite

Sat, 03/03/2012 - 06:13 | 2219384 _ConanTheLibert...
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We have been greeked.

Fri, 03/02/2012 - 19:08 | 2218476 noses
noses's picture

No. Their olives are better although they're using poisonous chemicals to extract the oil from time to time. Their tapas are tastier than the sad wine leaves from greece and their islands are mostly inhabited by Brits (ok, that might be a disadvantage).

Fri, 03/02/2012 - 17:22 | 2218190 americanspirit
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You have to ask - what are all these people buying a little desperate time in hopes OF? Is there something they are hoping will happen? Or are trying to make happen?

Are they just blindly flinging around magic money, or do they actually hope to accomplish something specific with their 'liquidity'? If so, what?

Or are they simply insane? Is that it? Nothing more complicated?

Fri, 03/02/2012 - 17:38 | 2218241 Squid Vicious
Squid Vicious's picture

They are buying some precious time until their innovative and resilient economies can resume a trajectory of strong growth bolstered by low taxes and the unquenchable European spirit of hard work and entreprenuership...

on second thought, yeah maybe they are insane... 

Fri, 03/02/2012 - 18:26 | 2218358 knukles
knukles's picture

Insane.
Definitely batshit fucking insane.

definition of sanity: Clarity of thought.
QED

Fri, 03/02/2012 - 18:35 | 2218369 kaiserhoff
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I've wondered about that.  One of my father's favorites:

When you are up to your ass in aligators, it's hard to remember that your original objective was to drain the swamp.

Fri, 03/02/2012 - 17:23 | 2218193 THECOMINGDEPRESSION
THECOMINGDEPRESSION's picture

Never ending lies, cons, stealing,deceit,controlling world governments. The world should make a quick flip. The good stay, the rest fly into space. Whoops.. That would just about empty this world..

Fri, 03/02/2012 - 17:23 | 2218194 LongSoupLine
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Alas this cycle of self-delusion and reality will continue, with ever wider swings in amplitude until the N+1 injection is so big that the floodgates finally open and wheelbarrows are the most desired object on earth.

 

As I said yesterday, "Long wheelbarrows, short wallets."

Other than that...silver (bitchez).

 

 

Fri, 03/02/2012 - 18:06 | 2218317 SPAREPARTS
SPAREPARTS's picture

Nah that wont happen, you could inflate several hundred % and that would get most of it straight, at least funtioning again

Fri, 03/02/2012 - 17:29 | 2218205 CompassionateFascist
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The lies being told in Europe are as nothing compared to the lies being told in Zionist Ponzified America. At least the Euro isn't being propped up by the carrier battle group-enforced "reserve currency status" of the dollar. When that first Iranian missile hits the first US warship, we go to hyperinflation w/in a matter of hours. 

Fri, 03/02/2012 - 18:01 | 2218299 Solarman
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Maybe after the productive capacity of Iran is smoldering ten minutes later perhaps.

 

Seriously though a war game was completed where this scenario was executed.  It devastated the Navy.  That was ten years ago though, countermeasures are now implemented to reduce the effectiveness of this barrage.

 

But nothing is going to happen, this is all game theory, the Iranians know they are whacking at a bees nest, regardless on how righteous their cause is.

Fri, 03/02/2012 - 18:31 | 2218335 CompassionateFascist
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Iran's "cause" isn't any more "righteous" than ours. It's all a power struggle. Life=War. And this particular war is massively overdetermined and now on a short countdown.  

Fri, 03/02/2012 - 18:08 | 2218323 SPAREPARTS
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No way, why?

Fri, 03/02/2012 - 18:28 | 2218360 CompassionateFascist
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Oil- the central global commodity - spikes and sticks at c. $300/barrel...maybe worse. Most other commodity futures and prices quickly follow, esp. food. Grocery stores and banks get run as dollar collapses. Historically, the transition from inflation (real: 10%, right now) to hyperinflation goes very, very fast. Now, thanks to digitification of finance, it will go at lightspeed.

Fri, 03/02/2012 - 18:48 | 2218415 Calmyourself
Calmyourself's picture

Nah, price controls, rationing and of course shooting black marketers in the public square will help too..

Fri, 03/02/2012 - 17:31 | 2218209 Mr Lennon Hendrix
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Tyler wrote,

€1 trillion in new money

Fiat is not money, it is currency.

Fri, 03/02/2012 - 17:57 | 2218292 Zero Govt
Zero Govt's picture

and the difference between money and currency is??

i've got my electron microscope out to study the answer!

Fri, 03/02/2012 - 19:12 | 2218426 Mr Lennon Hendrix
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Fiat currency does not store wealth.

Fri, 03/02/2012 - 19:27 | 2218525 Dr. Kananga
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"and the difference between money and currency is??"

No underlying counterparty risk required?

Fri, 03/02/2012 - 17:27 | 2218210 BandGap
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My ex-wife lied about her figure for years, too. What's the big deal?

 

Fri, 03/02/2012 - 18:00 | 2218296 Zero Govt
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depends on how much money she's into you for and how chilled you are about not getting a Cent back if divorced

Fri, 03/02/2012 - 17:29 | 2218218 fonzannoon
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"No. All it indicates is the conversion of future inflation (courtesy of €1 trillion in new money in the past 3 months) for a very temporary respite before all hell ultimately breaks loose as countries pretend everything is ok as bond yields are pushed artificially low. And in doing nothing, the fundamentals in the economy only get worse and worse"

Is this not what the US did? Are the US fundamentals not improving? Maybe Europe gets 4 years or so of reprieve. Maybe they start twisting data around after that like we could be doing? Maybe they get a few more years...It goes on and on.

Fri, 03/02/2012 - 18:06 | 2218225 DosZap
DosZap's picture

Easy,steal as much fiat as possible, and back out.( make sure all Au reserves are moved clandestinely),or you will lose it, just like Greece.

The key is steal as much as you can, renig on the deals, and keep your Soverignty.

This is ALL the bailouts are about, taking over the worlds Soverigns........................

Fri, 03/02/2012 - 17:34 | 2218230 surf0766
surf0766's picture

The TD's have been saying this since the first whisper of Greece financial troubles.  Give it to one and they all want.

The collapse still happens just as they stated it would .

Fri, 03/02/2012 - 17:39 | 2218235 piceridu
Fri, 03/02/2012 - 17:36 | 2218237 hedgeless_horseman
hedgeless_horseman's picture

 

 

I have set myself a softer budget target, too!

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